• What is an Account?
• Account Types
• Chart of Accounts
• Understanding the General Ledger
• Account Hierarchy
• Running an Account Balance
• Managing Your Accounts

What is an Account?

An account is a record that tracks all transactions related to a specific item or activity in your business. Each account maintains a running balance that increases or decreases as you record journal entries.

Accounts are organized by type and used to:

• Track assets (what your business owns)
• Track liabilities (what your business owes)
• Track equity (ownership stake in the business)
• Track income (money earned)
• Track expenses (money spent)

Account Types

Pricefic uses five fundamental account types:

Assets

Money and valuables your business owns. Examples include:

• Cash
• Bank accounts
• Accounts receivable (money customers owe you)
• Equipment
• Inventory

Debit Balance — Assets increase with debits, decrease with credits

Liabilities

Money your business owes to others. Examples include:

• Accounts payable (money you owe suppliers)
• Loans payable
• Credit card balances
• Unearned revenue

Credit Balance — Liabilities increase with credits, decrease with debits

Equity

The owner's investment and accumulated earnings. Examples include:

• Owner's capital
• Retained earnings
• Owner's drawings

Credit Balance — Equity increases with credits, decreases with debits

Income

Money earned from your business activities. Examples include:

• Sales revenue
• Service income
• Interest income
• Rental income

Credit Balance — Income increases with credits, decreases with debits

Expense

Money spent to operate your business. Examples include:

• Rent
• Salaries
• Utilities
• Supplies
• Depreciation

Debit Balance — Expenses increase with debits, decrease with credits

Chart of Accounts

Your chart of accounts is a complete list of all accounts used in your business. It's organized hierarchically so you can:

• View accounts by type
• Drill down into sub-accounts for detailed tracking
• Group related accounts together

A well-organized chart helps you:

• Quickly find the right account when recording entries
• Generate accurate financial reports
• Analyze your business performance by category

Access your chart of accounts from Accounting → Chart of Accounts.

Understanding the General Ledger

The general ledger is the master record of all journal entries posted in your business. It shows:

• Every account you use
• All transactions affecting each account
• The running balance for each account
• The date and reference for each transaction

The general ledger serves as the source for all your financial statements:

• Balance Sheet — Summary of assets, liabilities, and equity
• Income Statement — Summary of income and expenses
• Trial Balance — Verification that debits equal credits

View your general ledger from Accounting → General Ledger.

Account Hierarchy

Accounts are organized in a parent-child structure:

• Parent Accounts — High-level categories (e.g., "Current Assets")
• Sub-Accounts — Detailed accounts under the parent (e.g., "Cash", "Accounts Receivable")

This hierarchy lets you:

• Report on summary totals (all assets combined)
• Drill down into specific accounts
• Maintain consistency in your financial structure

When creating journal entries, you typically post to sub-accounts, not parent accounts.

Running an Account Balance

Each account maintains a balance calculated from all posted entries:

For Asset and Expense accounts:

• Debits increase the balance
• Credits decrease the balance

For Liability, Equity, and Income accounts:

• Credits increase the balance
• Debits decrease the balance

Balances are calculated in real time as you post entries, so your financial statements are always current.

Managing Your Accounts

View Account Activity

Click any account to see:

• A complete transaction history
• All journal entries affecting that account
• Running balance at any point in time

Edit Account Details

From Accounting → Chart of Accounts, you can:

• Update account name or description
• Change the account type (before recording entries)
• Reorganize the account hierarchy
• Activate/deactivate accounts

Archive Unused Accounts

As your business grows, deactivate accounts you no longer use. Archived accounts:

• No longer appear in entry creation dropdowns
• Still show historical transactions
• Can be reactivated if needed

Well-maintained accounts ensure your financial records remain organized and accurate.